Proposed Draft of Capital Value for Municipal Property Tax

By Santosh Kumar & Sunit Gupta*

The Mumbai Municipal Corporation has finalized the draft rules on capital value system for the lands and buildings and has invited comments and suggestions from the public before 16th November 2010 so that the same is implemented. The capital value of any property will be based on the values given in the Stamp Duty Ready Reckoner and Market Value of Flats in Mumbai 2010. These rates will be effective from 1st April 2010 and onwards. However, because of the delay in implementing this system, the corporation has sent the property tax bills for the period April to September as per ratable value system only and bill for the period October 2010 to March 2011 will follow as per capital value system after the proposed rules are approved by the Standing Committee of the corporation.

In case if there is any increase in the tax the same will be recovered in the second bill, however if there is any decrease in tax, the credit of excess amount of the first bill will be given in the final bill.

Properties will have weight age according to it’s use, nature and type of building, age of building and floor factor. The draft rule has fixed the method of arriving capital value of the property. On this value, rate of tax (say 0.2% ) of the value, which is yet to be decided by the standing committee, will be adopted for billing. Some of the salient features of the draft rules are as under. For full text of draft rules one can visit corporation’s web site or www.apcigroup.in

User Category of open land

Sr. Type Weightage
1. Open land residential 1.00
2. Open land commercial 1.25
3. Open land industrial 1.10

User Category of residential building

Sr. Type Weightage
1. Flat/Room 1.00
2. Bungalow/Row house/Duplex 1.25
3. Car parking in stilt or basement 0.25

User Category of commercial building

Sr. Type Weightage
1. Shop/office 1.00
2. Hotel five-star or above 1.25
3. Bank 1.20
4. Restaurant and bar 1.10

User Category of industrial building

Sr. Type Weightage
1. Industrial estate 1.25
2. Service industrial estate 1.05
3. Enclosed garage 0.30
4. Society office 0.30

Type of building

Sr. Type Weightage
1. Luxurious RCC Building 1.2
2. Normal R.C.C. Building 1.0
3. Pucca building 0.7
4. Semi-permanent building 0.5

Age of building

Sr. Type Weightage
1. 0 to 5 years 1.00
2. More than 5 years up to 10 years 0.97
3. More than 10 years up to 15 years 0.94
4. More than 15 years up to 20 years 0.91
5. More than 20 years up to 25 years 0.88
6. More than 25 years up to 30 years 0.85
7. More than 30 years up to 35 years 0.82
8. More than 35 years up to 40 years 0.79
9. More than 40 years up to 45 years 0.76
10. More than 45 years up to 49 years 0.73
11. More than 49 years 0.70

Floor factor of RCC building with lift

Sr. Type Weightage
1. Basement used for other than parking 1.00
2. Lower ground floor 1.00
3. Upper ground floor 1.00
4. Ground floor 1.00
5. From 1st to 4th floor 1.00
6. From 5th to 10th floor 1.05
7. From 11th to 20th floor 1.10
8. From 21st to 30th floor 1.15
9. From 31st to 50th floor 1.20
10. From 51st to 75th floor 1.25
11. From 76th to 100th floor 1.30
12. Above 100th floor 1.35

Examples for fixation of Capital Value.

(1) Residential Flat on 12th floor in a building with lift.

Weightage
Base Value (BV) Rs. 80,600/- Not Applicable
User category (UC) Residential 1.00
Nature and type of building (NTB) RCC building other than luxurious RCC building 1.00
Age of building (AF) 6 years 0.97
Floor number (FF) 12 1.10
Built-up area (BA) 80 sq.mtr. Not Applicable

CV = BV X UC X NTB X AF X FF X BA

= 80600 X 1.00 X 1.00 X 0.97 X 1.10 X 80

C.V. = Rs. 68,80,016/-

If the rate of property tax is 0.2%.

Annual Property Tax will be

68,80,016 X 0.2/100 = Rs.13,760/-

Writers are co-authors of the Property Tax Ready Reckoner of Mumbai Municipal Corporation 2009-10, published by The Architects Publishing Corporation of India.





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